A Clarification of Terminology
Document ID: 2008-903
Published on: 1st June 2008
Author: John Hibbert
In this note we aim to clear the confusion around the term ‘best-estimate’ which has been used to describe both a real-world expectation (by us) and a risk-neutral valuation (by European insurance regulators). In future, given the potential for confusion, we will drop the use of the term best-estimate for describing model calibrations and replace it with the widely-used ‘real-world’ term.
